Why Nektar Therapeutics Rippled Higher This Week

Nektar Therapeutics (NASDAQ: NKTR) stock surged by more than 20% in the week to Friday morning. The move wasn't so much caused by anything specific to Nektar's drug development program. Instead, investors bought into the stock because of the disappointing phase 3 results reported by another drug company, Sanofi.

Nektar's lead drug is rezpegaldesleukin, a treatment for skin conditions alopecia areata and atopic dermatitis. The company is making promising progress with the drug and received a fast track designation from the U.S. Food and Drug Administration (FDA) for it in the treatment of atopic dermatitis in February. That good news was followed by another FDA fast track designation for it in severe to very severe alopecia areata at the end of July.

However, as is often the case in the pharmaceutical industry, other companies are developing rival programs, one of which is Sanofi's amlitelimab for atopic dermatitis. It's not that amlitelimab failed to meet its primary and secondary endpoints, but rather that the efficacy data wasn't strong enough when compared to that of Sanofi's existing treatment for the same condition, Dupixent -- a drug that goes off patent in 2031.

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Source Fool.com